I recently delved deeper into an approach to detect altcoins before they experience a strong price surge, and I want to share it with everyone because I find it quite useful.

There are many influencers online who often talk about which coins will go up or down, but they rarely disclose their specific methods. I prefer sharing practical knowledge rather than making vague predictions, so today I want to guide you through a specific technique: using two indicators, OI and CVD, to identify tokens with breakout potential.

First, let’s understand what OI is. OI (Open Interest) simply refers to the number of open contracts in the market. When OI increases, it means new money is flowing in; when OI decreases, money is flowing out. For low-cap tokens, this indicator becomes especially valuable.

Regarding CVD (Cumulative Volume Delta), this indicator measures the difference between buying volume and selling volume. CVD accumulates based on the direction of trades, not price. When the market has a clear trend, CVD will show positive or negative values; during sideways movement, CVD hovers around zero.

Using these two indicators together is key. If OI increases and CVD also rises, that’s a positive buy signal. If OI increases but CVD decreases, it indicates selling pressure is mounting. If OI decreases and CVD decreases, long positions are being liquidated. If OI decreases but CVD increases, short positions are being closed. These scenarios are only truly useful when you’re analyzing tokens with good liquidity in volatile markets.

Now, let’s look at how to apply this practically. Go to the Marketplace on Velo Data, and you’ll see filters by market cap. Select Small Caps to find high-volatility altcoins, and choose shorter timeframes like 1H or 4H.

Next, select the OI Change chart. This shows the change in open interest — when positive, buying strength is increasing; when negative, selling pressure is rising. Filter for tokens with positive OI change and upward price movement.

Then, observe the normalized CVD chart (OI-Normalized CVD). This provides additional data on who is more active in the market — buyers or sellers. If buyers are more active, the token’s price may continue to rise.

For example: RLC (iExec) is currently at $0.41, down 3.59% in 24h. If you see its OI increasing but CVD decreasing, that indicates more sellers, so it’s not a good entry point. Conversely, ARPA is at $0.01, down 3.49% in 24h. If ARPA’s OI is rising and CVD is also starting to increase from below zero, buyers are trying to take control, and a slight upward move could happen.

However, remember that CVD is just an indicator for reference; don’t rely on it alone for decisions. Combine it with EMA or other technical indicators for a more comprehensive view. For short-term trading, always set stop-losses because markets can turn unexpectedly.

The great thing is, you don’t have to just listen to others’ predictions — you have tools to analyze yourself. CVD combined with OI can help you spot early signals that many overlook. But keep in mind, cryptocurrencies are extremely risky; trade responsibly and only invest what you can afford to lose.